From Managerial Ability to Climate Action: The Mediating Role of Corporate Governance in Achieving SDG 13 in the UK Context

ABSTRACT In line with the United Nations Sustainable Development Goal (UNSDG) 13, which emphasizes the urgent need to reduce greenhouse gas emissions and mitigate climate change, this study investigates the role of managerial ability and corporate governance in shaping firms' climate change commitments. Using a sample of 4056 firm‐year observations from companies listed on the London Stock Exchange over the period 2013–2022, the analysis employs ordinary least squares regression, complemented by generalized method of moments and two‐stage least squares estimations to address potential endogeneity concerns. Drawing on stakeholder theory and upper‐echelons and Institutional theory, the findings reveal that greater managerial ability is positively associated with more substantial corporate commitments to addressing climate change, reflecting managers' enhanced oversight capacity, strategic orientation, and ethical awareness. Moreover, the results indicate that corporate governance mechanisms partially mediate the relationship between managerial ability and climate change commitment, underscoring their role in translating managerial competencies into practical climate actions. This study contributes to the environmental and corporate governance literature by providing empirical evidence on the importance of organizational ability and governance structures in advancing corporate climate strategies and supporting the achievement of the climate objectives outlined in the 2030 Agenda for Sustainable Development.